Groupage to Nigeria is becoming increasingly popular. However, many importers still do not understand what groupage to Nigeria is. At least, they do not know how it works from origin country to Nigeria. Many are asking what really is groupage to Nigeria? Some are keen to know who does what in a groupage shipping. Others are totally confused, and want to know end-to-end what this popular shipping method entails. To worsen matters, the internet is awash with fluffs on the subject of groupage.
Consequently, this article will take a fresh look on the following:
- What is a less than container load (LCL) shipping?
- What is a groupage in shipping?
- How does groupage relate to LCL (Less Than Container Load) shipping?
- Who does what in a groupage container shipping?
- Benefits of groupage container shipping
- Groupage to Nigeria specific requirements, how to clear on arrival
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GROUPAGE TO NIGERIA: WHAT IS LESS THAN CONTAINER LOAD SHIPPING?
Sea freight containers are usually shipped as full container Loads (FCL), Less-than Container Load (LCL) or as a groupage. Full Container Load (FCL) is presumably owned by one shipper. However, one shipper does not always have enough goods to fill up a container. Unfortunately, shipping companies will not reduce shipping cost of a container because the container is not full. Of course, it is unreasonable to expect cost reduction for a container shipping carrying a less than full capacity load. To optimize cost, less than container loads and groupage shipping are the alternatives.
Less than container loads are pieces of small items or packages that are not voluminous enough to occupy a full container. Thus, less than container loads shipping is the shipping of such aggregated pieces by shipping lines. The shipping company receives LCL from different Shippers and consolidates at their own container freight station (CFS). Therefore, the shipping line charges each shipper directly, and issues them with individual bill of lading. Hence, it is not wrong to say that less than container load shipping is shipping smaller pieces separately.
LCL shipping is often for smaller pieces of items arriving to different locations.
GROUPAGE TO NIGERIA: WHAT IS GROUPAGE CONTAINER SHIPPING?
In Nigeria, like many countries, shipping companies do not accept or ship inbound less than container loads. Consequently, shippers of less than container loads to such countries must seek the services of a forwarder. The forwarder gathers pieces of LCL in his warehouse, and adds them up into a full container load. This arrangement of smaller pieces belonging to different shippers (customer) to make a full container is consolidation. Thus, most people refer the forwarder or agent as the consolidator or groupage operator.
Consolidation is the aggregating of pieces of parcels belonging to different customers by a shipping agent or forwarder, into a container capacity load. Such parcels are usually within the same country, and are inbound to the same destination port.
Similarly, groupage is the consolidated LCL. Groupage container is the equipment housing the consolidated LCL. Hence, groupage shipping is the shipping of consolidated LCL.
Furthermore, groupage container shipping presupposes the following:
- Firstly, multiple shippers or customers as forwarders call them, within same port of origin or location
- Secondly, each shipper has Less-than Container Load of cargoes
- Thirdly, each LCL is moving to same destination
- Fourthly, each shipper must be willing to work within the terms of the groupage arrangement. including sharing of costs and benefits of the groupage.
DIFFERENCE BETWEEN LCL SHIPPING AND GROUPAGE SHIPPING
Most people use the terms LCL shipping and groupage shipping interchangeably, and understandably so. However, from the few paragraphs above, you can see some technical differences. Let us highlight these differences below for the sake of emphasis:
- LCL shipping is a direct deal with the shippers and the liners. Whereas, groupage shipping is between shippers and the shipping agent or forwarder. The Liner does not recognize individual shippers, but sees the forwarder as the shipper in a groupage. The forwarder in turn relates to his customers. It is best to use the term customers than shippers because even the importer or any other designated entity can relate with the forwarder.
- In addition, freight charges are from shipping lines directly to the shipper for LCL, while the shippers in groupage pay to the Forwarder.
- Again, in LCL shipping, the shipping line issues individual bill of lading to each shipper. Whereas, the forwarder in a groupage makes house bill of lading for each customer in a groupage. The forwarder receives master bill of lading from the shipping company in a groupage shipping.
- Equally, LCL shipping are not necessary moving to the same location, but groupage is bound to the same location.
- More so, LCL shipping by liners are CFS/CFS, which means that shipping line takes responsibility from their own container freight station (CFC) at the origin. In addition, Liners end such responsibility at their own container freight station at the destination port or ports. Groupage shipping can be a CFS/CFS or a door-to-door arrangement.
WHO DOES WHAT IN A GROUPAGE CONTAINER SHIPPING?
The question of who does what in every shipment depends largely on the terms of trade. On a general note, the following parties perform the roles below:
EXPORTER OR SHIPPER
The exporter is responsible for packaging the LCL, engaging and sending the parcel to the forwarder. This is if the shipping term is FOB. If the agreement is ex works, it means the importer is picking up the parcel from exporter’s warehouse. In which case, the importer will engage his own agent or freight forwarder. Ex works is best if importer have a local presence in the country of supply of goods.
In most cases, the exporter charges total cost and freight on small goods, and takes care of shipping.
THE FREIGHT FORWARDER
The middleman in the groupage arrangement is the freight forwarder. An experienced and expert forwarder is in a best position to consolidate LCL. As the consolidator, freight forwarder gathers pieces of parcels, consolidates and ships. He engages shipping company and does all local export clearance. It is the responsibility of the forwarder to issue the House Bill of Lading (HBL) to customers. In addition, the forwarder will have to negotiate clearance and delivery, for door-to-door in the destination.
WHO NEEDS GROUPAGE TO NIGERIA?
You need groupage if as a shipper, your cargo is Less-than Full Container (LCL). There are many shippers in this category, both in Nigeria and overseas. A typical example is a shipper who imports or exports specialized type of cargoes or bespoke products regularly but at a quantity or size not big enough for a Full Container Load (FCL).
Many items bound to Nigeria require groping. These goods originate from China, Bangkok, Thailand, USA, Australia, Singapore, Canada, Europe, etc. Goods originating from Nigeria to different parts of the world can also benefit from groupage shipping. Small scale importers and exporters therefore make up the bulk of shippers needing groupage shipping arrangements.
GROUPAGE TO NIGERIA: SPECIFIC REQUIREMENTS, THE IMPORTER’S ROLE
Let us now take a closer look at groupage to Nigeria in particular. The importer has the responsibility that his goods follow importation laws and principles in Nigeria. He is to make sure of the following specifics:
- Form M document before shipping: not all exporters know the Form M requirement in Nigeria. Hence importers should educate their shippers or shipping agents well.
- SONCAP and other regulatory agencies’ certifications: does the goods require SON or NAFDAC? Is it an item needing NERC import permit? As the importer, you want to research well to avoid pleasant surprises during clearance. The SON rule requires importers to have SONCAP before goods arrive to Nigeria for goods needing SONCAP for example. Other agencies like NAFDAC also have similar rules. Therefore, it is always best to engage local professionals to consult for you. Vagmon e-Grup & Logistics Ltd is a foremost expert clearing and forwarding agency in Nigeria. Our contacts are at the bottom of this page.
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CONCLUSION
Shipping groupage to Nigeria is profitable. Groupage is not the same as LCL. In LCL shipping, parcels are assembled into the container by shipping liners. Thus, liners charge the shippers direct freight in proportion to the goods in LCL shipping. The forwarder mediates with shipping line and shipper in groupage shipping. While LCL can be for goods bound to different destinations, groupage is bound to the same location. Thank you for reading this post. Finally, feel free to contact us using the details below for groupage shipping and clearance in Nigeria.
Contact Vagmon e-Grup Logistics Ltd for all groupage to Nigeria. Phone/WhatsApp: +234 907 552 6276 Email: info@clearingandforwardingnigeria.com. Website: https://clearingandforwardingnigeria.com